NORFOLK, Va.  A federal judge Tuesday cited progress in Michael Vick's bankruptcy case, and the Atlanta Falcons reiterated in court that they planned to trade their imprisoned and suspended quarterback.

"It's a complex case. There are a lot of moving parts. ... The issues seem to be clarifying," bankruptcy court judge Frank J. Santoro said.

Vick is serving a 23-month sentence at the federal prison in Leavenworth, Kan., after pleading guilty in 2007 to bankrolling a dogfighting operation in his home state of Virginia.

He was not at Tuesday's hearing on his bankruptcy case, which was continued until another hearing set for June 9.

Earlier this month, with Vick in the courtroom, Santoro rejected his Chapter 11 bankruptcy plan to sell assets and pledge percentages of his future income to pay more than $20 million in debts.

The judge said the plan was insufficiently funded and noted Vick's future earnings were uncertain because he must be reinstated by NFL Commissioner Roger Goodell. But the judge gave Vick and his attorneys a chance to rework the plan.

While negotiations on that continue between attorneys for Vick and his creditors, the judge approved Tuesday a settlement between Vick and the Falcons.

The Falcons initially sought repayment of more than $20 million in bonuses. After that was reduced to $3.75 million in federal court, Atlanta appealed. The case remains on appeal.

Under the deal approved Tuesday, Vick will pay the Falcons $6.5 million if he wins the appeal and $7.5 million if the team wins. Atlanta will retain contract rights to Vick as a player.

The judge asked an attorney for the Falcons whether they planned to trade him and not to put him back on the field.

"That's correct, your honor," Atlanta attorney John Isbell said.

"The benefits of having the player under contract are, in this case, trade rights. ... He can't go as a free agent and sign with another team."

Vick is scheduled to return to Hampton, Va., on May 21 to begin home detention. That will run through the July 20 completion of his federal sentence. As part of detention, he has agreed to take a construction job for $10 an hour.

Meantime, the owner of the Albany (N.Y.) Firebirds told the local newspaper, The Times Union, that the Arenafootball2 franchise's one-year contract offer to Vick that was put on the team website early Tuesday was a "publicity stunt" and he would not have approved it.

The Firebirds pulled the announcement, which said Vick was offered a one-year contract at the league standard — $200 a week plus a $50 bonus for a win — later Tuesday.

It also was announced in court Tuesday that Vick had reached a settlement with the U.S. Department of Labor. The department had filed complaints accusing Vick of violating federal law by transferring money from a pension plan run by one of his companies. Vick's attorneys said in court that the lone formality left in the settlement was getting Vick's signature.

Once he signs, Vick will owe about $316,000 to the pension plan within three days and another $100,000 within 90 days.

When the judge asked Vick's attorneys where the initial $316,000 would come from, they said that would be covered by the temporary return to Vick of legal fees in his bankruptcy case.

"We're doing what's needed to make this case successful," Vick's attorney, Paul Campsen of Norfolk, said outside the courthouse.

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